Yuan vs. U.S Dollar – The race to dominate the $2 trillion stablecoin market

Key Points

1. JD.com and Ant Group are urging China’s central bank to approve Yuan-based stablecoins to counter the growing dominance of U.S. dollar-backed stablecoins like USDT and USDC.

2. The stablecoin market, currently valued at $247 billion, is projected to reach $2 trillion by 2028, with over 99% of stablecoins tied to the U.S. dollar.

3. China’s push for Yuan-backed stablecoins marks a potential policy shift since its 2021 crypto ban, aiming to improve the Yuan’s efficiency in cross-border payments.

4. The Yuan’s share in global payments fell to 2.89% in May 2024, while the U.S. dollar maintained a 48.46% share, prompting Chinese exporters to increasingly use USDT for settlements.

5. JD.com plans to launch a Hong Kong dollar-pegged stablecoin by year-end, while Ant Group is seeking licenses in Hong Kong, Singapore, and Luxembourg to expand its blockchain payment infrastructure.